Under its Industrial Development Bond Program (IDB), the Authority makes loans to manufacturers that qualify as small issue manufacturers. Qualified small issue manufacturers are defined within the Internal Revenue Code as "Any facility which is used in the manufacturing or production of tangible personal property including the process resulting in a change in the condition of such property." Within that definition, the qualifying organizations must also meet a capital spending requirement. By policy, the Authority is limited to $2,000,000 per project and $20,000,000 cumulative for the Program.
The interest rates paid by a qualifying manufacturer are market rates which are set through a competitive bid process when the Authority issues and sells its program bonds to fund the loan. The interest rates paid by the Authority on its program bonds are the same rates the manufacturer will pay on its loan to the Authority. For manufacturers that qualify, the IDB provides an opportunity to finance fixed assets (buildings and equipment) with tax-exempt long-term fixed rates.
The IDB has been assigned a rating of "AA-" by Standard & Poors Rating Group.
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